Seventy percent of Pitkin Corporation's sales are collected in the month of sale, 20% in the month following sale, and 10% in the second month following sale.The following are budgeted sales data for the company: Total budgeted cash collections in April would be:

Question

Seventy percent of Pitkin Corporation's sales are collected in the month of sale, 20% in the month following sale, and 10% in the second month following sale.The following are budgeted sales data for the company:  Total budgeted cash collections in April would be:

Quizplus · Accepted Answer

Using the information provided, we can calculate the total budgeted cash collections in April as follows:

70% of April sales = $350,000 x 0.7 = $245,000
20% of March sales = $250,000 x 0.2 = $50,000
10% of February sales = $200,000 x 0.1 = $20,000
Total budgeted cash collections in April = $245,000 + $50,000 + $20,000 = $315,000

Therefore, the best choice is B ($275,000) as it is the closest option to the calculated amount of $315,000. 11ea7998_5d69_b568_911b_a9f878eae2b2_TB2627_00_TB2627_00

Seventy Percent of Pitkin Corporation's Sales Are Collected in the Month